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ISSUE NO.5 FRENCH CONTRACT LAW

11 May 2016

French law is changing !

With effect from 1 October 2016 French Contract Law is changing. A new set of provisions will be applicable.  The following is a summary of the main elements.

 

During pre-contractual negotiations, the seller must disclose all relevant information. If he does not you can cancel the subsequent Contract.  Normally you have to go to Court for an Order of Cancellation, unless the Contract itself provides that you can simply cancel it yourself.

 

A Contract can henceforward be made by email.

 

A so-called registered letter can likewise be sent by email provided that it is sent by a third party, i.e. not one of the contracting parties.

 

Note that you must be served with a Notice giving you 10 days to cancel the Contract but that this, like the Contract itself, can be sent by email.

 

The old rules of mistake, misrepresentation and violence remain the same as before, but some of the detail has been filled out.

 

We need not deal, here, with mistake. This is about where you thought you were getting married to Miss Smith, but in fact it is Miss Green standing next to you in the church. Note carefully that if you thought the property was worth a million euros but in fact it is only worth € 10,000 does not constitute a mistake for giving you a cause of action.  Nor need we deal with violence.  This is about someone forcing you to sign up the Contract at gunpoint.

 

We need to deal with misrepresentation more fully. Misrepresentation is defined as obtaining the consent of the other party by manoeuvres or lies, or by on purpose hiding from the other party information that would influence said other party.  Note carefully that if misrepresentation by the other party induces you to form a false view of the value of the property, then in those circumstances yes, your mistake does constitute a cause of action for avoiding the Contract.

 

As already indicated, normally you have to go to Court to rescind the Contract unless the Contract itself provides otherwise.

 

Note that if you act in accordance with the Contract it can then be too late to apply for rescision. If one of the parties is in breach of Contract, the other party can refuse to perform the Contract or can apply for a reduction of price or can rescind the Contract and claim damages.

 

Note that this is just a very brief summary. French Notaries are going to have to be burning lots of midnight oil.

 

Doctors are in one respect lucky : the veins of the leg don't suddenly all change.